GPCI Cuts due to MACRA

UPDATE: February 9, 2018 – Congress passed the Bipartisan Budget Act of 2018 which granted a two-year extension of the Geographic Practice Cost Indices (GPCI) floor through December 31, 2019.

The Geographic Practice Cost Index (GPCI) floor of 1.0, which was established in the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), expired December 31, 2017.

What does this mean to you?
GCPI sets the variable Medicare uses to adjust the work component of physician payments based on where they live. The three components of the Resource-Based Relative Value Scale (RBRVS) – physician work, practice expense, and malpractice expense – are all multiplied by GPCIs, which have gone below 1.0 in 52 states and/or metropolitan areas. An index above 1.0 lifts provider payments, and an index below 1.0 would drops them. Therefore, providers should expect a drop of at least 1% in affected areas.

What to expect next
Congress typically addresses these provisions last minute as part of a spending bill, but as lawmakers are currently on their third stopgap spending measure, we would not be surprised if this takes months to fix.

Once a fix is in place, the GPCI floor most likely be re-established retroactively, meaning providers in localities that lost money due to the MACRA expiration will be reimbursed.

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